The Securities and Exchange Commission on Wednesday reluctantly approved an exchange-traded fund (ETF) that directly holds Bitcoin, a move that digital currency fans have been waiting for and a move that has drawn a lot of attention from financial watchdogs skeptical of the crypto industry. It has been criticized.
The commission approved 10 exchange-traded funds (ETFs) to invest in Bitcoin, including funds proposed by large corporations and small financial firms such as BlackRock and Fidelity.
“While we today authorized the listing and trading of certain Spot Bitcoin ETP shares, we do not endorse or endorse Bitcoin,” said SEC Chairman Gary Gensler. statement. “Investors should remain cautious about the myriad risks associated with Bitcoin and products whose value is tied to cryptocurrencies.”
Gensler also added that approval of the Bitcoin fund does not mean the SEC will approve funds or exchange-traded products (ETPs) based on other digital currencies or assets.
“Importantly, the Commission’s action today is limited to ETPs holding Bitcoin, which is a non-secure commodity. Additionally, this approval does not reflect the Commission's view regarding the status of other crypto assets under federal securities laws or the current status of non-compliance with federal securities laws by certain crypto market participants. It doesn't suggest anything about it,” Gensler said.
The SEC had rejected similar fund applications for years. But last year, the U.S. Court of Appeals for the District of Columbia Court of Appeals ruled against the SEC for refusing to approve an application from Grayscale to convert its derivatives funds directly into Bitcoin. ”
“Based on these circumstances and the circumstances discussed in more detail in the approval order, we feel that the most sustainable path is to approve the listing and trading of these Spot Bitcoin ETP shares,” Gensler said. explained.
The long-awaited approval has been hailed as a watershed moment for the digital currency, with proponents hoping it will expand access to investing in Bitcoin and lead to wider acceptance of the cryptocurrency as a legitimate financial asset. It is argued that it is possible. The price of Bitcoin has exploded in recent months, rising from about $25,000 in September to more than $45,000, a move that many Bitcoin investors believe is due to demand for Bitcoin assets. This is partly because we believe that it will create more.
Critics slammed the SEC Wednesday night.
Dennis M. Kelleher, co-founder, president, and CEO of Better Markets, said the approval “simply unleashes cryptocurrency predators on tens of millions of investors and retirees.” “This is a historic mistake that is likely to undermine financial stability.”
“As the blatantly lawless crypto industry collapses and burns with mountains of arrests, convictions, bankruptcies, lawsuits, scandals, huge losses, and the victimization of millions of investors and customers, the SEC Who would have thought that the company would come to the rescue with a “trusted company that enables mass sales of worthless, unstable, and known fraudulent financial products to Americans on Main Street?” It's about approving accessible investment vehicles,” Kelleher said.
